SOROTI – Soroti City is losing over Shs 100mln monthly as a result of noncompliance among the tenderers and businesses that evade paying taxes, forcing authorities to think of what to do next.
In the current financial year 2022/2023 which ends on June 30, 2023, Soroti City authorities contracted 18 companies to collect tax revenue from local businesses.
However, the report of the revenue performance in the financial year indicates that many of these companies are not remitting funds to the city council as per the terms and conditions of the contracts awarded to them.
For instance, M/s Inofit Investment Company was contracted to collect loading and offloading fees to the tune of Shs 25mln at the end of the financial year, however, only Shs 23mln has been realised.
The contract to collect taxes from hotels and lodges was awarded to M/s Art Point Services with the task of collecting Shs 20mln monthly as per the contract agreement.
This means that the tenderer was meant to collect Shs240Mln by the end of the financial year 2022/2023.
However, M/s Art Point Services have only managed to collect which is less beyond the targeted Shs 20mln.
Margrate Acako, the Soroti City revenue officer said the business community has continued to invade taxes.
She explained that the default rate is among the rented stores including stalls in the markets around the city.
According to Acako, there is also an illegal collection of revenue, forgery of general receipts and operating licences among the business community.
She Inofit Investment Company which was contracted to collect loading and offloading fee also subcontracted brokers who are not remitting revenue collected to the city council.
“They have our money and we shall demand it and if they continue to breach the contract obligation, we shall be forced to blacklist them,” said Acako.
Acako said that in the financial year 2021/2022, the city council projected to collect Shs 4.12 billion but only realised only Shs1.6bln, leading to a 21 percent budget deficit.
She said that the situation is worsening due to an incompetent team of revenue collectors.
Joshua Edongu, the Soroti City mayor told this reporter in a brief interview that frequent central government pronouncements on local revenue, collections such as bus park user fees now have affected revenue collecting.
He also said the city council continues to lose revenue to mobile vendors and hawkers.
“Much as hawking is provided for in the law, we don’t encourage hawking because they don’t pay taxes. The vendors don’t want to go inside the new market built for them fearing they would be charged tax,” Edongu added.
Efforts to get comment from the tenderers were futile as a number of them declined to comment on the matter.
Meanwhile, James Oboro, the deputy clerk Soroti City said they have introduced an integrated revenue administration system that will eliminate some of the challenges.
“We have also formalised our revenue enhancement plans and development including fresh valuation of properties in the city for the purpose of establishing new property rates,” said Obore.
He therefore called on members of the public to pay their taxes so that city authorities can improve service delivery.
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